“The only evidence of inflation in the U.S. economy is tied to oil,” explained Lawrence Kudlow, chairman of the investment policy committee at Schroder & Co. “But I believe we’ve seen the peak in oil prices, especially now that the production spigots are going to be opened by OPEC, so the Fed has no business doing what they’re doing.”

As oil prices fall, erasing any inflationary aspects of the economy, the Federal Reserve may put through only one more interest-rate hike, instead of the three or four that some investors had been fearing, strategists said yesterday.

But the effect of the lower oil prices may be felt even sooner — in terms of corporate profits.

“If you look at the old-economy, smokestack-type stocks, which makes up 40 percent of corporate America, you’ll see that they are greatly affected by the price of oil,” said Kudlow. “It’s a big cost and they factored that into their earnings. But now that the price has come down, the earnings can go higher.”

Earlier in the week, oil prices had hit a nine-year high, but have since dropped more than 8 percent as a response to the OPEC production move.

However, oil prices rose slightly yesterday on confusion about how much OPEC would boost production.

“We don’t know how much they’re going to ramp up production, and we don’t know how soon,” said Kudlow, explaining yesterday’s 43-cent increase in the price of a barrel of oil.